Green is the New Black - ahact.org · Multifamily Energy Loan (MEL/ECL) State-funded program since...
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September 29, 2015 Green is the New Black Moderator: Evan Seretan, UIL Holdings Corp. Panelist: Elizabeth Murphy, UIL Holdings Corp. Panelist: Kim Stevenson, Connecticut Green Bank Panelist: Cal Vinal, CHIF Panelist: Enoch Lenge, Eversource
Transcript of Green is the New Black - ahact.org · Multifamily Energy Loan (MEL/ECL) State-funded program since...
September 29, 2015
Green is the New Black
Moderator: Evan Seretan, UIL Holdings Corp.
Panelist: Elizabeth Murphy, UIL Holdings Corp.
Panelist: Kim Stevenson, Connecticut Green Bank
Panelist: Cal Vinal, CHIF
Panelist: Enoch Lenge, Eversource
Elizabeth Murphy, UIL Holdings Corp.
Multi-Family Property Energy Efficiency Incentives
Energize Connecticut
▪ Energize Connecticut is a statewide branding initiative to help consumers save money and use clean, affordable energy.
▪ A partnership of the Energy Efficiency Fund, the Connecticut Green Bank, Department of Energy and Environmental Protection (“DEEP”) and local electric and gas utilities.
▪ Efficiency incentive programs funded through the Connecticut Energy Efficiency Fund. – Established in 1998 with natural gas programs added in 2005
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What We Offer
▪ Comprehensive energy solutions for market
rate and income eligible multi-family
properties
– Financial incentives, rebates, and financing
– Technical assistance and installation services
– Owner and tenant education
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Eligible Multi-Family Property Types
▪ Any multi-family property with 5+ units
▪ Not-for-profit, market rate and income
eligible customers, including:
– Private owners / landlords
– Housing authorities
– Housing associations
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Paths to Incentive Program Participation
▪ Market rate – no tenant income restrictions.
▪ Income eligible – two-thirds of the property’s
residents are at or below 60% of the state
median income (“SMI”).
– Subsidized housing (e.g. Section 8)
– Housing for disabled veterans
– Housing for elderly
– Group homes
– Residential treatment facilities
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Why Energy Efficiency?
▪ Reduce energy bills
▪ Reduce operations and maintenance costs
▪ Improve energy performance
▪ Improve tenant comfort
▪ Improve tenant satisfaction
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Commonly Incentivized Measures
▪ Weatherization:
– Air sealing / duct sealing
– Low flow shower heads
– Faucet aerators
– Pipe wrap
▪ Energy-efficient lighting:
– Dwelling unit
– Common area
– Exterior
▪ Add-on Measures:
– Insulation
– Windows
– High efficiency heating
equipment
– Domestic hot water heaters
– High efficiency control
strategies (e.g., ECM pumps,
VFD)
– Appliances
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Custom measures are evaluated based on
opportunities identified within the property.
Connecticut Green Bank Providing Easy Access to
Affordable Capital
September 29, 2015
Connecticut Green Bank Who We Are
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Multifamily Housing What We Do
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▪ Help owners save money on energy and operating costs,
and improve the living environment for tenants
▪ Provide technical assistance and financing
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Technical Assistance Financing
Solutions
TECHNICAL ASSISTANCE
ENERGY LOAN
PRE-DEVELOPMENT
ENERGY LOAN
CASE STUDY
Project Financing Solutions
MULTIFAMILY CREDIT
ENHANCEMENT FUND
SOLAR FINANCING
CHIF LIME LOAN
www.c-pace.com Brian Sullivan – [email protected]
Thank You
John R. D’Agostino
Sr. Manager, Multifamily
845 Brook Street
Rocky Hill, CT 06067
(860) 257-2333
Kim Stevenson
Associate Director, Multifamily
845 Brook Street
Rocky Hill, CT 06067
(860) 257-2890
www.greenbank.com/multifamily
Energy Efficiency Retrofit Lending:
Affordable Multifamily
CT Housing Coalition
Cal Vinal 9.29.15
Challenges to Multifamily Energy Financing
Ownership structures impede financing
Barriers to securing mortgages/liens
HUD/FHA, CHFA, Housing Authorities - restrictions
C-PACE subordination, cost
Conventional loan-to-value limits, costs of refinancing
Ownership frequently a single-purpose entity
Lacks strong balance sheet or liquidity
Challenge getting syndication approvals
Education, coordinated/standard process, marketing
Split benefit (tenant pays utility bills)
Financing Energy Efficiency Retrofits in Affordable Multifamily
Financing Energy Efficiency Retrofits in Affordable Multifamily
Opportunities in Affordable Multi-family
Leverage and build off of existing HES-IE resources – rebates and processes available; financing can stretch these resources to have greater and broader impact
“Low-hanging fruit” – affordable multi-family properties are often much less efficient than market-rate and high-end rental housing, greater ROI
High access to natural gas infrastructure - high concentration in urban areas
Higher economic impact – lower-income households have less disposable income and savings; dollar reduction in energy expenses has more impact and multiplier effect
Cost savings to local Housing Authorities – Conventional financing not typically possible for HAs,
Economic incentive - Property owners to profit from efficiency improvements
Facilitate “one-stop shopping” – Develop more standardized approach to standardize approach and maximize overall potential cost effectiveness of multifamily efficiency improvements, and tie financing and centralized usage data gathering
Products/Measures/Terms
Multifamily Energy Loan (MEL/ECL)
State-funded program since 1980 (DOH funded)
Almost any energy savings measure, mostly replacement
5-30 units - more units with equal per unit energy investment
Max $3,500/unit, $100,000/deeded property
Soft second, basic underwrite
10-year self-amortizing term
6% (3% if >50% @ 80% AMI), furnaces/boilers 0%
Any ownership/borrower structure
Works well with HES Income-Eligible
Financing Energy Efficiency Retrofits in Affordable Multifamily
Products/Measures/Terms
Low Income Multifamily Energy (LIME) Loan C-PACE alternative, all measures including Solar, Health/Safety
5+ units, targeting 60% affordable at 80% AMI, restricted & natural
Unsecured - No lien/priority or LTV issues, seek guaranty
Borrower - Single-purpose entity owner or sponsor/mgt company
Energy Saving Coverage Ratio - 1.30:1 target (75%)
ESCR buffer for pricing, behavior, optimization issues
Net Energy Savings (NES) determines improvements/loan size/term
6% rate, 2% fee plus third-party cost, up to 20 year term
No borrower out of pocket if costs funded under ESCR
Seek comprehensive measures, Solar has different term and ESCR
Smaller LIME loans for limited measures (Easy, Mini)
Immediate property value increase, owner shares “mezz” NOI
Leverages eligible rebates (including Income Eligible - IE)
Financing Energy Efficiency Retrofits in Affordable Multifamily
For more information on LIME Loans:
Brian Sullivan [email protected]
800-992-3665, Ext. 2020
www.ctgreenbank.com/multifamily
Financing Energy Efficiency Retrofits in Affordable Multifamily
Presented by:
Enoch Lenge, Eversource
New Construction or Existing
Buildings: How to participate
Two Multi-family Paths 1. Residential New Construction (“RNC”)
– Ground up new construction
– Redevelopment
– Gut rehabs
2. Existing Building Multi-family – Moderate rehab
– Capital improvements
– Targeted energy upgrades
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Residential New Construction Program
Multi-family Project Process Flow ▪ Kick-off meeting during design phase
▪ Copy of blueprints submitted to utility
▪ Utility reviews blueprints for qualifying measures
▪ Additional information requested from architect or engineer
▪ Utility creates RNC incentive application which earmarks incentive to the project
▪ Inspections done by HERS rater or utility staff
▪ Project can be paid out in phases
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Why Third-Party Verification?
▪ Energy consultant
▪ HERS Raters
▪ Blower door & duct blaster
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Case Study: Chamberlain Heights
Redevelopment – Meriden, CT
MEASURES AS BUILT
ENERGY STAR Certification
Applicant
$1,687.50 x 124 = $209,250
(HERS 59)
Rater
$165
High Performance Insulation & Air Sealing Incentive Amount
168,575 sqft x $0.75 = $126,431
ENERGY STAR HVAC
Central A/C, Heat Pump, Ductless Split Heat
Pumps
Incentive Amount
$250 Central A/C + $500 Furnaces= $750x 124
=$93,000
ENERGY STAR Certified Hot Water Heater Incentive Amount
$450 x 124 = $55,800 Natural gas tankless
per unit incentive = $3,907 ACTUAL TOTAL $484,481.00
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Project details: Townhouse style buildings – 124 Units (natural gas) Low Income Bonus Incentive
Existing Multi-family Building
▪ Process
Energy assessment
and/or Proposal
Utility Letter of
Agreement
Energy Efficient
Measures installed
Inspection & Payment
Case Study: Heritage Glen
▪ CNG and Eversource Electric
▪ Income Eligible – 5 buildings, 68 units
– CHFA funded improvements
– Natural gas heat and DHW – central meter
MeasureInstalled
CostIncentive
Annual
Savings
(kWh)
Annual
Savings
(ccf)
Air sealing 72,916$ 69,106$ 1,102 7,795
DHW measures 1,034$ 1,034$ 95
Dwelling unit lighting 1,285$ 1,285$ 7,874
Duct sealing 25,869$ 25,869$ 17,427
High-efficiency furnaces 118,000$ 26,793$ 2,679
ECM motors 13,940$ 13,940$ 26,180
Air conditioning units 70,231$ 46,119$ 17,243
Attic insulation 20,884$ 14,270$ 167 686
Total 324,159$ 198,416$ 69,993 11,255
Questions?
Enoch Lenge
Eversource
Multifamily Program Lead
860-665-5369
Elizabeth Murphy
The United Illuminating Co.
Senior Program Administrator
203-499-2843
Take action now!
EnergizeCT.com
877-WISE-USE
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Q & A
